Given the Following Information from an Amortization Table, Compute the Interest

Given the following information from an amortization table, compute the interest expense and the carrying value for the next line of the table, rounding your answer to the nearest dollar: $$\begin{array} { | c | c | c | c | } \hline \begin{array} { c } 2 \% \text { Cash } \\\text { Interest }\end{array} & \begin{array} { c } 1 \% \text { Effective } \\\text { Interest }\end{array} & \begin{array} { c } \text { Premium } \\\text { Amortization }\end{array} & \begin{array} { c } \text { Carrying } \\\text { Value }\end{array} \\\hline \$ 800 & \$ 412 & \$ 388 & \$ 40,812 \\\hline\end{array}$$

A) Interest Expense $408; Carrying Value $40,420
B) Interest Expense $408; Carrying Value $41,220
C) Interest Expense $412; Carrying Value $40,420
D) Interest Expense $412; Carrying Value $41,220

Correct Answer:

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